The interim report of the Productivity Commission on GST distribution reforms shows what everyone in NSW already knew – the system is rigged against us and Western Australia is getting more than its fair share.
The $23 billion cost of the reforms has largely benefited Western Australia, while NSW receives just 82 cents in the dollar – the lowest since the introduction of the GST.
NSW deserves a better deal from the Albanese Labor Government in Canberra after being short-changed with record low GST relativities and just 17% of the nation’s infrastructure funding, despite having 31% of the population.
The test for Anthony Albanese, Chris Minns and Labor is whether they will deliver reforms to give NSW and the rest of Australia their fair share, or whether they will continue to provide a sweetheart deal to Western Australia and leave everyone else worse off.
Early comments from Western Australian Premier Roger Cook that the Prime Minister has promised to keep Western Australia’s deal in place are concerning and shows that genuine reform from an independent body will be put aside for the political interest of the Labor Party.
If the No Worse Off guarantee were to end, NSW would be facing a fiscal cliff, with data in the report showing the state’s fiscal position would be significantly diminished if this were not in place.
The report indicates it would cost $47 billion to provide all States with the same fiscal capacity as Western Australia. That exposes just how distorted the current arrangements have become and the NSW Liberals and Nationals call on Labor to address this inequity.
As the Productivity Commission has not endorsed the EPC+ model put forward by the NSW Government in their submission, NSW Treasury must urgently assess which of the three options for reform put forward by the Productivity Commission is in the best interests of NSW.
If Chris Minns and Daniel Mookhey are finally ready to stand up to Canberra and demand our fair share, the NSW Liberals and Nationals stand ready and willing to assist.